NEW YORK (AP) – New York state housing authorities have, for now, stopped one of the richest real estate deals in New York City history.

Housing Commissioner Deborah Van Amerongen told The Associated Press on Saturday that her office has rejected a developer’s second $1.3 billion attempt to buy Brooklyn’s Starrett City complex “because we don’t believe it protects the residents.”

“What they want to do is to implement a market rate rent for all the units,” Ms. Van Amerongen said. And that means, she said, that rents would increase for most apartments occupied by 12,000 people on the 140-acre property, which is subsidized under the state’s Mitchell-Lama as well as federal programs.

It was the second try by Clipper Equity LLC partner David Bistricer to get approval to purchase Starrett City, the nation’s largest federally subsidized housing complex. This time, he made a greater effort to address the issue of affordability, and how it might be secured – through “enormous” government subsidies, the commissioner said.

Clipper Equity spokeswoman Lisa Linden did not immediately return a call seeking comment on Saturday.

The purchase of the nearly 6,000-unit affordable housing haven, owned by Starrett City Associates, requires both federal and state approval. But denial by either effectively stops the sale, though by law Clipper still has time to submit yet another proposal, Ms. Van Amerongen said.

Last month, the federal housing secretary, Alphonso R. Jackson, blocked the original proposal, saying he didn’t believe the developer could preserve affordability.

Mr. Bistricer then offered a new plan with the help of a prominent architect and lobbyists, while enlisting input from two influential black ministers – the Reverend Calvin O. Butts III, of Harlem, and the Reverend A. R. Bernard, of Brooklyn.

The latest move against the sale was detailed in a letter the commissioner sent on Thursday to an attorney for the developer, John L. Kelly.

Ms. Van Amerongen wrote that the plan had “failed to adequately ensure that Starrett City would be preserved as viable affordable housing in the future.”

Federal housing officials, who also are reviewing the plan, have not yet issued their opinion on the new proposal, the commissioner said.

The commissioner said she believes the main hurdle to Bistricer’s proposal is the purchase price, $1.3 billion, which would require bigger government subsidies to keep rents below market price for thousands of units.

In its latest bid, Clipper said the rents would reach market rates within three years. About 90 percent of the residents would then be eligible for subsidies, the commissioner said.

Clipper Equity “needs rents at that level to pay that purchase price,” said the commissioner, who was appointed by Governor Spitzer. The governor, she said, “is very focused on the preservation of affordable housing.”

More than 2,000 tenants at the 30-year-old complex pay about $200 to $400 monthly for federally subsidized apartments. The families live on annual gross incomes of about $20,000 to $40,000 and many fear their rents will rise dramatically.

About 2,000 tenants pay up to $1,200 in rent under the state’s Mitchell-Lama program. Since the 1950s, the program has provided lucrative government financing to developers in exchange for building low- and middle-income housing subsidized by the government.

The state holds Starrett City’s $234 million mortgage, but a buyer could withdraw the complex from the Mitchell-Lama program by paying the balance.

On Saturday, tenants applauded the state’s move.

The rejection of the latest “irresponsible proposal” sends “a clear message that developers intent on exploiting government subsidies for windfall profits need not apply,” said Bertha Lewis, executive director of the community group New York ACORN, or the Association of Community Organizations for Reform Now.